OTT a $25 Billion Industry, Boston Consulting Group Says

Over-the-top now generates $25 billion revenue annually, Boston Consulting Group (BCG) reported Tuesday. Of the more than 500 OTT service providers globally, most are local players competing in a single market, BCG said. The top five global players -- Netflix, Amazon, Hulu, Time Warner's HBO and Google's YouTube -- generate about half of the total market revenue and are expected to grow due to advantages like scale in content creation and technology, BCG said. OTT growth is leading to a content boom, BCG said, with 1 billion amateur and professional content creators "adding daily (actually, hourly) to the content mix available through OTT channels." It said the middle tier of entertainment programming "is collapsing" due to content consumption bifurcating between "high production value, must watch shows ... and more modest, traditional professional, pro-am or even amateur productions." Live sports remains one area for TV channels to attract major audiences, with OTT driving additional growth by creating new monetization routes, BCG said. Traditional networks might start moderating their spending on content as OTT competitive pressures grow, but spending by major OTT players in the U.S. is expected to keep growing.